Staff
recommends approval of the resolution authorizing an agreement with Capital
Office Products, Inc. to provide office products and supplies, as needed.

Analysis:

Departments
within the City of Leesburg have the need to purchase office products and
supplies necessary to their regular operation. The purpose of this agreement
is to contract with an interested and qualified company to provide office
products and supplies at the quoted unit prices and discount percentages.

This
solicitation was issued as a cooperative effort between Lake County Procurement
Services and the City of Leesburg. The City’s participation in this
solicitation with Lake County allows us to benefit from their higher usage of
this commodity. The pooled usage of both agencies will result in lower pricing
than the City could obtain on our own.

On
June 13, 2008 Lake County Procurement Services issued county Request for Proposal (RFP) 08-0616. On July 9, 2008 the county received three responses to the
RFP.

Three
Lake County staff members and I evaluated the proposals from interested
firms. The committee determined that Capital Office Products offered the best
pricing as well as meeting all the requirements for service, on-line ordering,
and reporting.

This
agenda item was initially presented to the commission on September 8, 2008. At that time the Commission identified several concerns about unit prices on the
Core Item Pricing list. I have renegotiated pricing on those items whose prices
seemed high. I either requested the vendor to submit a revised price or
propose an equivalent item having better pricing. The attached revised Core Item
Pricing list reflects the new pricing as well as new total cost based on
estimated annual quantities.

In
order to receive the best pricing, an office product contract for large
organizations typically includes a core list and a discount percent off other
categories not in the core list. The core list is defined by the City and will
include the City’s high use items. The vendor is able to give the best pricing
on the core list of known items. Departments are encouraged to use items from
the core list as much as possible to realize the biggest savings. The
Purchasing Division will monitor City purchases and adjust the Core Product
List based on actual usage. The City can remove items no longer used and add
items used more frequently. Active management of the Core List and encouraging
departments to purchase items on the Core List is the key to controlling costs
for office products.

Discounts
on printer toner and ink cartridges are an additional component to this
contract. Capital Office Products was very aggressive in their discount
provided for printer cartridges. Authorized wholesalers receive rebates from
Hewlett Packard based on their sales volume. Capital has added these rebate
amounts into the discount they are offering. Printers are used by city
departments on a daily basis and the cost of printer supplies has increased
substantially in the past several years. The 60% discount on new cartridges
offered by Capital will result in significant savings to the City. A price
comparison sheet is attached for your review. This sheet lists each model and
quantity of printer currently used by the City.

Included
here is a summary of the attached detailed price comparison sheets.

Category

Capital Office Products

Ernie Morris Enterprises

Core Item Listing

$51,278.31

$61,542.69

Toner Cartridges

$9,140.88

$13,546.78

Non Core Discount

60% Off

55.1% Off

Office Furniture Discount

55% Off

46.7% Off

Office Machines

40% Off

28.2% Off

Evaluation
items to note:

Staples
Office Products was later disqualified as they took exception to the
general terms and conditions of the county. They were also unable to
provide a key requirement in the on-line ordering system as detailed in
the RFP. The RFP required that vendors be able to display both the list
price and the agencies contract price. Staples were not able to provide
that feature.

The
County precluded Office Depot from participating in this solicitation due
to some past pricing problems they experienced. The County felt it would
not be in their best interest to allow Office Depot to participate. It is
well documented in the public arena that Office Depot is experiencing
pricing problems with other agencies in Florida as well as other states.
The main problem appears to be their inability to keep contract pricing
for the various agencies straight. The County, and other agencies,
experienced overcharges on some items when compared to the agencies
contracted price for the item(s). The City of Leesburg has been using
Office Depot under the umbrella of the State of Florida Purchase Agreement
with the vendor.

A
local vendor preference was not offered in this solicitation. Lake County does not offer a local vendor preference on solicitations and under the current
City of Leesburg policy (adopted January 27, 2003 by Resolution 6710) the local vendor preference would not apply to this solicitation. The annual value/cost
of this agreement will exceed $25,000 placing it in Category V of the
purchasing thresholds.

Several
departments within the City of Leesburg have been approved to use Capital
Office Products for about six months. At that time, and currently, Capital
offered better pricing than Office Depot on copy paper and many other items.
The departments using Capital office products have been very satisfied with
their pricing and service. In one instance, the Finance Department solicited
quotes from both Capital Office Products and Ernie Morris Enterprises on the
purchase of four items. Capital Office Products was $34.34 less than Ernie
Morris Enterprises.

The
initial term of the contract will be for one year from the date of execution
and provides for four one-year renewals.

Options:

1.
Approve execution of the agreement with Capital Office Products, Inc.; or

2.
Direct the Purchasing Manager to withdraw from participation in the listed RFP
and issue an

Invitation to Bid (ITB) for the purchase of office supplies.

Fiscal
Impact:

The
exact fiscal impact is unknown as it depends on actual purchases by departments
throughout the term of the contract. Based on the significant discount
percentages, the City should realize a cost savings with this new contract.

Submission
Date and Time: 11/6/2008 5:07 PM____

Department:
_Finance________________

Prepared
by: _Mike Thornton__________

Attachments:
Yes__X_ No ______

Advertised:X___Not
Required ______

Dates:
__________________________

Attorney Review : Yes___ No ____

_________________________________

Revised 6/10/04

Reviewed
by: Dept. Head ________

Finance Dept. ___________JB______

Deputy C.M. ________EFS_________

Submitted
by:

City
Manager ___________________

Account No. ____NA__________

Project No. _____NA__________

WF No. ________NA___________

Budget ________NA___________

Available _______NA___________

RESOLUTION
NO._______________

A RESOLUTION OF THE CITY COMMISSION OF
THE CITY OF LEESBURG, FLORIDA AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE
AN AGREEMENT WITH CAPITAL OFFICE PRODUCTS, INC. FOR PROVIDING OFFICE PRODUCTS
AND SUPPLIES; AND PROVIDING AN EFFECTIVE DATE.

BE
IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF LEESBURG, FLORIDA:

THAT the Mayor and City Clerk are hereby
authorized to execute an agreement with CAPITAL OFFICE PRODUCTS whose address is 700 Ballough Rd., Daytona Beach, Florida 32114-2210
for providing office products and supplies on an as needed basis pursuant to Lake County and City of Leesburg cooperative Request for Proposal 08-0616.

THAT this resolution
shall become effective immediately.

PASSED AND ADOPTED by the City Commission of the City of Leesburg, Florida, at a regular meeting held the __10th___ day of __November__
2008.